Hong Kong taps into Chinese funding

Local players worry about a shift in film content

Hong Kong producers are worried about a drastic drop in film production. Currently fewer than 50 films are made annually, compared with 70-plus at the turn off this century. In the 1980s and early ’90s heyday, annual output stood at more than 100 movies, and Hong Kong titles ruled throughout East and South East Asia.

What producers sometimes choose to overlook is that annual production numbers in mainland China have soared during the same period and may reach 400 movies this year. Take the two industries together, and the trend is upward — but that also implies that Hong Kong’s pic industry is now a subset of China’s biz.

That may make some people uncomfortable, but there’s plenty to suggest that the two are now locked in a symbiotic relationship.

“Hong Kong movies will never be the same,” says United Intl. Pictures’ VP of sales and marketing Kurt Rieder, who points to the loss of Hong Kong’s export crown in the 1990s, the 1997 end of British rule in the territory and the massive market potential of China.

More recent events may have acted as the catalyst. “CEPA (Closer Economic Partnership Arrangement) changed the Hong Kong market forever,” says John Chong, CEO of Media Asia, the territory’s leading production and distribution group.

CEPA, a free-trade pact between China and its Hong Kong Special Administrative Region (SAR), delivered a three-step opening of the Chinese market to Hong Kong companies. They can now own exhibition chains and export their movies more easily.

There remain some restrictions on the free circulation of Hong Kong movies and the requirement to fit into China’s more rigid censorship regime. But these days there are few calls for a fourth stage of CEPA, and improving Hong Kong movies’ chances in Chinese theaters is largely a matter concerning circulation of low- and medium-budget Cantonese-language pics in the Guangdong region that abuts the Hong Kong SAR.

Reason for the lack of angst is simple: The majority of Hong Kong movies today are made with mainland Chinese partners. “All Hong Kong films are co-productions these days,” Chong says. This way they can be treated as local Chinese movies, avoid import restrictions and tap into the surprisingly large volume of private-sector coin available for movie production.

The Chinese theatrical market has bounded ahead, too. Roughly the same size as Hong Kong’s $120 million box office only four years ago, China’s turnstile takings have grown at 30% a year and, according to China Film Group, will hit $400 million this year.

“Hong Kong needs China. But it’s not just about Chinese money,” says Woody Tsung, head of Hong Kong’s Motion Picture Assn., “it is also about stories and locations.”

That’s a worry to some. “When the trend is to seek out mainland Chinese investment, topics set in mainland China and relying on the Chinese market, it’s hurting the fundamental quality that’s unique to Hong Kong movies,” says helmer Stanley Kwan, though he himself is a founder of Hong Kong-Chinese shingle J.A. Media.

Concern is that the range of genres and subject matter acceptable to Chinese regulator the Film Bureau is narrower than for Hong Kong, and that Hong Kong helmers will tailor their repertoire to suit Chinese rather than domestic tastes or self-censor their content.

In particular, that means period costumers and risk of audience exhaustion. Hong Kongers, who have a far wider choice on their screens than mainland auds, already treat mainland movies with a degree of skepticism. Feng Xiaogang’s “The Banquet” and Jacob Cheung’s “Battle of Wits” did business in China but scored only modest B.O. in Hong Kong.

Media Asia’s Chong says the Film Bureau is prepared to flexibly interpret its regulations on the number of Hong Kong actors in mainland films.

“China needs Hong Kong directors and name stars; they have local stars, but very few are famous elsewhere,” adds Tsung.

Among the Hong Kong titles to recently get a Chinese release is Derek Yee’s “Protege,” which features superstar Andy Lau. But Ang Lee’s China- and Hong Kong-set “Lust, Caution” was edited for Chinese release because of its explicit sex scenes.